The Commission has adopted an Action Plan aimed at achieving a 20 % reduction in energy consumption by 2020. The Action Plan includes measures to improve the energy performance of products, buildings and services, to improve the yield of energy production and distribution, to reduce the impact of transport on energy consumption, to facilitate financing and investments in the sector, to encourage and consolidate rational energy consumption behaviour and to step up international action on energy efficiency.

ACT

Communication from the Commission of 19 October 2006 entitled: Action Plan for Energy Efficiency: Realising the Potential [COM(2006) 545 – Not published in the Official Journal].

SUMMARY

The purpose of this Action Plan is to mobilise the general public, policy-makers and market actors, and to transform the internal energy market in a way that provides EU citizens with the most energy-efficient infrastructure (including buildings), products (including appliances and cars), and energy systems in the world.

The objective of the Action Plan is to control and reduce energy demand and to take targeted action on consumption and supply in order to save 20 % of annual consumption of primary energy by 2020 (compared to the energy consumption forecasts for 2020). This objective corresponds to achieving approximately a 1.5 % saving per year up to 2020.

In order to achieve substantial and sustainable energy savings, energy-efficient techniques, products and services must be developed and consumption habits must be changed so that less energy is used to maintain the same quality of life. The Plan sets out a number of short and medium-term measures to achieve this objective.

The Action Plan runs for a six-year period from 1 January 2007 to 31 December 2012. The Commission considers this timeframe to be sufficient to adopt and transpose most of the measures it proposes. A mid-term review will be carried out in 2009.

POTENTIAL ENERGY SAVINGS

The Commission considers the biggest energy savings are to be made in the following sectors: residential and commercial buildings (tertiary), with savings potentials estimated at 27 % and 30 % respectively, the manufacturing industry, with the potential for a 25 % reduction, and transport, with the potential for a 26 % reduction in energy consumption.

These sectoral reductions of energy consumption correspond to overall savings estimated at 390 million tonnes of oil equivalent (Mtoe) each year or €100 billion per year up to 2020. They would also help reduce CO2 emissions by 780 million tonnes per year.

These potential savings come in addition to an estimated 1.8 % (or 470 Mtoe) reduction in annual consumption which would partly stem from other measures already adopted and normal replacements of material.

Achieving the 20 % reduction objective will help reduce the EU's impact on climate change and dependence on fossil fuel imports. The Action Plan will also boost industrial competitiveness, increase exports of new technologies and will have positive benefits in terms of employment. The savings made will, moreover, offset the investments put into innovative technologies.

MEASURES PROPOSED BY THE ACTION PLAN

The Commission included in the Action Plan all measures presenting the best cost-efficiency ratio, i.e. those with the lowest environmental cost over the life cycle, which do not overrun the budget given for investments in the energy sector. Some are priority measures, and should therefore be adopted without delay, whilst others are to be implemented throughout the six-year period set for the Action Plan.

Improving energy performance

Effective action on energy-consuming equipment and appliances requires steps on two fronts: standards for the energy yield of appliances and an appropriate, consumer-focused system to label and evaluate energy performance.

To this end, the Action Plan provides for the adoption of Eco-Design minimum standards to improve the energy yield of 14 groups of products (including boilers, televisions and light fittings) and to extend it to other products in the long-term. In addition, the Commission hopes to strengthen the rules on labelling, in particular by regularly updating classifications and extending these rules to other equipment.

On the basis of Directive 2006/32/EC on end-use energy efficiency and energy services, the Commission plans to draft guidelines, a code of conduct and a certification procedure applicable to all sectors.

To substantially reduce heat loss in buildings, the Action Plan plans to extend the scope of the Energy Performance of Buildings Directive to cover small buildings, to develop minimum performance standards applicable to new and renovated buildings and to promote so-called "passive" houses.

Improving energy transformation

The energy transformation sector uses around one third of all primary energy, yet the average energy yield for transformation facilities is around 40 %. There is great potential for improving this, which would substantially help to reduce energy loss. Energy distribution and transport are also sources of energy losses where action could potentially be taken.

The Commission will develop minimum binding energy efficiency requirements for electricity generation facilities, heating and cooling for facilities operating with less than 20 megawatts of power, and possibly for more powerful facilities too.

It also plans to develop, in cooperation with industry professionals, guidelines for good practices designed both for existing facilities and for energy suppliers and distributors. The promotion of cogeneration will also be stepped up and connections with decentralised generation centres will be encouraged.

Limiting the costs linked to transport

With almost 20 % of total primary energy consumption and the fastest growth in consumption, the transport sector represents both a major environmental risk (greenhouse gas emissions) and one of the main factors of dependency on fossil fuels. To solve these problems, it is vital to take action on car use and on promoting cleaner alternative transport.

The Commission plans to set a binding target to reduce polluting car emissions to achieve the threshold of 120g of CO2/km by 2012. It also intends to address the issue of car components, such as air conditioning and tyres, in particular by issuing a European standard for rolling resistance and by promoting tyre pressure monitoring. Moreover, strengthening the rules on vehicle labelling will help to promote the most energy-efficient vehicles, as will proper awareness-raising campaigns and public authorities purchasing clean vehicles.

Urban transport will be the subject of a Green Paper, aimed at pooling experience to encourage the use of alternatives to car transport, such as public transport, non-motorised transport and teleworking.

Reducing the energy consumption of other forms of transport – rail, air and water-based – will also be studied. Accordingly, the Action Plan includes an initiative to extend the greenhouse gas emissions trading scheme to the air transport sector, to improve air traffic control (SESAR), to implement the third rail package, and to connect ships to the electricity network when in harbour.

Financing, incentives and fares

The Action Plan includes several types of measures to facilitate investments designed to boost energy efficiency.

The Commission also calls on the banking sector to offer financing opportunities tailored to small and medium enterprises (SMEs) and enterprises providing energy efficiency solutions (businesses providing energy services). In addition, the private banking sector, the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB) and other international financial institutions will facilitate the establishment of public-private partnerships.

The Commission also plans to remove, where possible, the national legal barriers to shared savings, third-party financing, energy performance contracting and recourse to businesses providing energy services.

Using the Structural and Cohesion Funds will also help provide support to regions in need, especially in the new Member States, including support for habitats.

Taxation is also a powerful tool for providing incentives. Here the Commission notes that it would draft a Green Paper on indirect taxation, revise the Energy Tax Directive, and encourage the taxation of private cars according to their pollution levels. It also highlights the potential for using tax credits as incentives for both companies and households.

Changing behaviour

Consumers' purchasing decisions will determine the success of the results. The Commission plans a number of educational measures to raise public awareness of the importance of energy efficiency, including education and training programmes on energy and climate change issues. It also proposes to organise a competition to reward the most energy-efficient school.

In addition, the Commission considers that public authorities should set an example. The Commission itself plans to obtain EMAS certification for all buildings it owns, and then to extend the initiative to all EU institutions.

It also plans to adopt guidelines on tenders and to set up networks for cities to exchange good practices concerning energy efficiency in urban areas.

Adapting and developing international partnerships

The Commission considers that European development and trade policies, agreements, treaties and other international instruments represent other ways to promote the spread and use of high energy yield technologies and techniques at global level.

It will launch an international conference with a view to adopting an international framework agreement on energy efficiency which will involve the EU's main trading partners and key international organisations.

Background

In its Green Paper on the European Energy Strategy, the Commission underlines the need to strengthen its energy efficiency policy. In addition, the target for a 20 % reduction in energy consumption set in this Action Plan is part of the measures requested by the European Council in March 2006 to ensure the environmental feasibility of European Energy Policy.

The policies and measures contained in this Action Plan are based on the consultations launched by the 2005 Green Paper on Energy Efficiency.

RELATED ACTS

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 13 May 2008 – “Addressing the challenge of energy efficiency through information and communication technologies” [COM (2008) 241 final – Not published in the Official Journal].

This communication places information and communication technologies (ITCs) at the heart of a combined European climate and energy policy. ITCs are effectively a means of improving energy efficiency in different sectors of the economy. To begin with the focus is on the most promising domains, such as the power grid, energy efficient buildings, smart lighting and ITCs, before the consultation and partnership process is launched, which will identify other areas for action. This communication also encourages research and innovation, cooperation, regional and national initiatives, as well as the dissemination of good practice in the field of ITCs.

Directive 2006/32/EC of the European Parliament and of the Council of 5 April 2006 on energy end-use efficiency and energy services and repealing Council Directive 93/76/EEC [Official Journal L 114 of 27 April 2006].

The EU adopted a framework on energy end-use efficiency and energy services. This framework includes an indicative goal for energy savings applicable to Member States, obligations for national public authorities regarding energy savings and energy efficient procurement and measures to promote energy efficiency and energy services.